In brief
A technical error at Bithumb, a South Korean cryptocurrency exchange, led to a massive over-distribution of funds, mistakenly granting customers 2,000 bitcoins instead of a 2,000 won cash reward. The company managed to recover almost all the erroneously sent bitcoins shortly after the incident. The case has prompted an investigation by the Financial Supervisory Service of South Korea and spurred discussions on regulatory reform in cryptocurrency transactions.
A South Korean cryptocurrency exchange accidentally gave away more than $40bn (£32bn) worth of bitcoin to customers, briefly making them multi-millionaires.
It had planned to give customers a small cash reward of 2,000 won - $1,37 - but instead gave them 2,000 bitcoins on Friday.
The platform, Bithumb, apologised for the error, adding that it quickly realised its mistake and recovered almost all the missing tokens.
It said it had restricted trading and withdrawals for the 695 affected customers within 35 minutes of the glitch.
The company said it had recovered 99.7% of the 620,000 bitcoins mistakenly sent.
We want to make it clear that this matter has nothing to do with external hacking or security breaches and there is no problem with system security or customer asset management, Bithumb said in a statement on Friday.
In an emergency meeting on Saturday, South Korea's financial regulator said it would look into the incident. Any sign of illegal activity would prompt formal investigations, the Financial Supervisory Service (FSS).
Bithumb vowed to cooperate with regulators. [We] will take this accident as a lesson and prioritise 'customer trust and peace of mind' rather than external growth, CEO Lee Jae-won said.
The company plans to pay 20,000 won ($13,66) in compensation to all customers who were using the platform at the time, and will waive trading fees, among other measures.
Bithumb said it would improve verification systems and introduce AI to detect abnormal transactions.
The incident is likely to spark discussion around tighter regulatory controls in finance.
In April 2024, Citigroup, a US bank, mistakenly credited $81 trillion, instead of $280, to a customer's account. Two employees failed to spot the error before it was processed, but the bank reversed the transaction within hours after a third employee caught the mistake, the Financial Times reported.
